Fiji Government Raises Income Tax Threshold, Lowers Trade Duties

“This latest decision of an increase in the income threshold from $9000 to $15,000, coupled with zero duty for basic food items, would mean a direct positive impact on low income earners who have been aversely affected with the rise in food prices."

Acting Finance Minister Filipe Bole of Fiji's interim government has announced that his Department has raised the nation's minimum income tax threshold from $9000 to $15,000 (U.S.), a move which is getting mixed reactions from economists. The new cut-off for income taxation goes into effect on June 1. The intent of the action is to give relief to lower-class and poor people, including many small farmers, in the wake of a potentially devastating food shortage which stems in no small measure from the rice "crisis" that has swept over much of Asia. Fiji is also experiencing rising inflation which the government action means to offset. The Finance Cabinet is also eliminating the trade duties on white and brown rice, cans of fish, and oil. Cheese, liquid milk, goat meat, lamb, and breakfast foods will all see their trade duties reduced from 27 per cent down to anywhere from 15 per cent to 3 per cent. “This latest decision of an increase in the income threshold from $9,000 to $15,000, coupled with zero duty for basic food items, would mean a direct positive impact on low income earners who have been aversely affected with the rise in food prices,” said Bole. The decision by the interim Finance Cabinet comes as the Fiji Islands Revenue and Customs Authority (FIRCA) reported that there has been a gigantic surge in tax revenues over the last 12 months. Tax revenues are up almost 32 per cent over the same time last year. Bole also acts as Fiji's Education Minister in the interim government. A couple of weeks ago he opened the Higher Education Advisory Board's inaugural meeting by declaring that there needs to be more transparency and laws in place to ensure that private and public funds that are put into education are actually used for their intended purposes. Bole said that while the laissez faire attitude of higher education authorities has "provided unprecedented access to Australian and other global providers of higher education to Fiji's higher education market,"the policy that allows greater access to post-secondary education for more local students...does not protect them from being exploited by profit-driven enterprises." Bole has a hardline take on private matters that is right in line with that of Fiji's military government, which came to power in 2006 after a successful coup by Commodore Frank Bainimarama, who is currently Fiji's prime minister. On May 5, Bainimarama met with senior media executives after Fiji Times publisher Evan Hannah, an Australian, was deported under allegations of threatening national security. The Prime Minister made it perfectly clear that he would never have any qualms about closing down any media outlet that was judged to threaten national security in the future. The Fiji High Court expects to receive detailed reasons behind the deportation on May 8. However, the prime minister has said that even if the Court decides that there was a violation of the law in the deportation of Hannah, he will never permit him to return home to Fiji.